China’s Economic Evolution in the Shadow of Japan’s Past
Experts stress the crucial importance of China learning from Japan’s prolonged economic stagnation, underscoring the need for a shift from reliance on manufacturing and investment to bolstering domestic consumption.
Drawing parallels between Japan’s economic trajectory in the 1980s and China’s current economic landscape, analysts closely examine shared lessons. Japan’s struggle to transition from a manufacturing and investment-heavy economy to one driven by domestic consumption serves as a cautionary tale for China, currently facing similar challenges after decades of investment-driven growth.
While the Maekawa report in Japan and Wen Jiabao’s 2007 speech in China highlighted the necessity of economic restructuring toward greater reliance on domestic consumption, both countries found it challenging to make this shift. Michael Pettis, a China economy expert, emphasizes that ignoring the need for restructuring could lead to prolonged economic stagnation. To successfully navigate these challenges, we urge China to confront its economic issues with a clear understanding of Japan’s past experiences and to avoid delaying necessary transformations.
Clever Robot News Desk 21st December 2023
